How you can tell when a product is just something you buy vs. a luxury? Price, right? Most of us own cars or appliances or houses or jewelry, so how do we tell what we own vs. those who are rich? Price.
What Apple has done with iPhone, and to a lesser extent with Mac, iPad, Watch, AirPods, and other products, is create a new category for a segment of the great unwashed masses of humanity who have aspirations for a better future.
I call it affordable luxury. iPhone is an affordable luxury. Based on all the advertising and promotions I saw during the holiday shopping season– iPhone, iPad, Mac, AirPods, Watch; all were on sale somewhere– Apple’s affordable luxury goods were not all that affordable.
Did not Apple just increase prices on products introduced before the holiday shopping season? Were those price increases big mistakes? Or, were they shrewd considerations of changing market conditions?
Is Apple gear more expensive? Yes. Because Apple makes more money than all competitors combined, I suspect the price increases that made some Apple products too expensive were increased for a good reason. Apple knows how to make money and when markets become saturated– and the smartphone market is saturated these days– it’s best to own the most expensive products because it’s easier to drop the price tag than it is to raise the price tag.
Of course, nattering nabobs of negativism and members of the technorati elite politburo have a different opinion of Apple’s recent price hikes. Daniel Ives on the iPhone’s prices:
This should be a wakeup call for Apple… They swung, and they really missed
Did they? In an era where customers are spending less does it pay to keep the same prices, and then discount, or, is it better to raise prices and then discount?
Unlike past years, however, Apple didn’t offer consumers much that was new for the 2018 models.
Except everything– all the hardware, and the software– was an improvement over the previous year. That was true of iPhone models, the Mac mini and iMac Pro, plus Apple Watch, and, of course iPad Pro. All had new price tags. Higher. And all have seen price discounts or reduced prices with bundles; something Apple doesn’t do too much, but obviously needed to in the past year.
Apple customer Keith Skinner:
If I could see a huge difference in a new phone, then maybe I’d be more prone for it, but $1,000 for one or two new features… I knew I wasn’t getting it
Uh huh. Skinner isn’t the average Apple customer because the typical iPhone customer does not upgrade their iPhones every year. But I understand the sentiment. If you own iPhone 7 and can’t seen any difference between what you own and a new iPhone XR, then why spend the money?
Do you not think Apple has a good idea of what is going on in the marketplace? Analysts don’t seem to think so, right? Even customers say Apple’s new iPhone, Mac, iPad, and Watch prices are too expensive. Yet, Apple will sell more of those premium goods than any premium goods competitor, and despite discounts and promos, will make more money on each one sold.
Is it not obvious that Apple raised prices for a good reason? It’s much easier to discount a desirable, aspirationally-branded product from a high price than it is from a low price.